Deutsche Bank Ag · XETR:DBK
Deutsche Bank — Investor Day (September 2003)
27 slides from Deutsche Bank's investor day presentation, Sep 30, 2003
Slide 1: Deutsche Bank Investor Day, New York, 30 September 2003
Dr. Josef Ackermann Chairman of the Group Executive Committee Deutsche Bank Investor Day New York, 30 September 2003
Slide 2: Introduction to Deutsche Bank Investor Day
Introduction to Deutsche Bank Investor Day 10:00 – 10:10 Investor Day Opening 14:00 – 14:40 Risk Management and Wolfram Schmitt Corporate Investments Clemens Börsig 10:10 – 10:50 Strategic Overview Josef Ackermann 14:40 – 15:20 Private & Business Clients 10:50 – 11:30 Global Markets Rainer Neske Ans
Slide 3: Phase 1 of management agenda
Phase 1 of management agenda … Performance management Focus on and current earnings focus core businesses Further improvement of Optimisation of the capital and balance PCAM franchise sheet management Investor Day · September 2003 · 3
Slide 4: … delivery under way …
… delivery under way … In EUR bn Scudder / 2001 Phase 1 1H2003 2Q2003 2001 RREEF / pro 2002 annual. annual. pro Herold forma forma* Underlying revenues 25.2 0.8 26.0 22.8 23.2 24.2 27.8 Total provision for credit losses (1.0) - (1.0) (1.9) (1.4) (1.3) (0.9) Operating cost base (22.5) (0.7) (23.3) (1
Slide 5: … transforming Deutsche Bank …
… transforming Deutsche Bank … 31 Dec 30 Jun ∆ 2001(1) 2003(1) Operating cost base (in EUR bn) 23.3(2) 17.5(3) (25)% Costs Employees (full-time equivalents) 86,524 69,308 (20)% Underlying cost/income ratio 89% 75% (14)ppt Risk-weighted positions (in EUR bn) 305 232 (24)% Capital Tier 1 ratio (BIS) 8
Slide 6: ... while maintaining a globally diversified platform …
... while maintaining a globally diversified platform … 1H2003 underlying revenues Global platform by region(1) Rest of Regionally well-diversified revenue Europe Germany base compared to competitors 31% One of the largest European banks 32% in the Americas(3) Asia-Pacific business significantly 28%
Slide 7: A resilient revenue base ...
A resilient revenue base ... Revenues of CIB, PCAM and equivalents, in EUR bn CIB underlying revenues 1H2003 PCAM underlying revenues 1H2003 #1 Citigroup (18)% #1 Citigroup (14)% #2 JPM Chase (5)% #2 JPM Chase (7)% #3 Deutsche Bank 7.4 (3)% #3 UBS (13)% #4 Morgan Stanley (9)% #4 BNP Paribas 0% #5 Go
Slide 8: ... resulting in significant improvement of operating performance ...
... resulting in significant improvement of operating performance ... Underlying CIR Underlying pre-tax profit Underlying pre-tax RoE in % in EUR bn in % 12ppt 17 1.2 89 (15)ppt 196% 85 1.0 13 77 74 0.4 5 0.3 4 FY FY 1Q 2Q Av.Q Av.Q 1Q 2Q FY FY 1Q 2Q 2001 2002 2003 2003 2001 2002 2003 2003 2001 2002
Slide 9: ... dealing with challenges in the German home market ...
... dealing with challenges in the German home market ... Group - Total provision PBC - Underlying AM - Underlying for credit losses, in EUR bn pre-tax profit, in EUR bn pre-tax profit, in EUR bn 2.1* 0.7 0.5 0.3 0.4 0.2 100% 100% 100% 87% 77% 78% 59% 0.5 0.3 38% 0.2 0.1 25% 0.3 0.5 FY2002 1H2003 FY
Slide 10: ... with Phase 2 management agenda unlocking further performance improvements
... with Phase 2 management agenda unlocking further performance improvements Maintaining strict cost, Capitalising on global capital and risk discipline leadership in CIB Delivering profitable Establishing Deutsche Bank growth in PCAM as the most reputable brand Investor Day · September 2003 · 10
Slide 11: Continued enforcement of cost culture
Continued enforcement of cost culture Rigorous cost management ... ... an ongoing effort Operating cost base, in EUR bn Full effect of phase 1 cost reductions 23.3 Severance not yet materialised / fully visible, e.g. 0.5 (3.9) – Headcount reduction program not (5.8) yet finalised (about 1,000 FTE
Slide 12: Further potential for capital reallocation ...
Further potential for capital reallocation ... 1H2003 Average active equity, In % Underlying pre-tax in EUR bn of total RoE, in % Group 28.9 100% 15 Group RoE target 25% Corporate Banking & 13.4 46% 25 Securities CIB Global Transaction 1.5 5% 15 Banking Asset and Wealth 6.5 22% 7 PCAM Management Pri
Slide 13: ... supported by ongoing loan exposure reduction ...
... supported by ongoing loan exposure reduction ... Total provision for credit losses, Loan book, in EUR bn in EUR m LEMG (38)% process 265 253 initiated 790 172 165 511 590 384 423 350 333 (35)% 31 Dec 30 Jun 31 Dec 30 Jun 1Q 2Q 3Q 4Q 1Q 2Q 2001 2002 2002 2003 2002 2003 Special item (change in mea
Slide 14: ... and continued wind-down of alternative assets exposure ...
... and continued wind-down of alternative assets exposure ... Alternative assets, in EUR bn Thereof 11.9 1.8 directs Thereof 9.7 (42)% 1.4 directs 8.3 7.7 6.8 6.9 5.1 (62)% CI - Private Equity 3.8 3.4 2.6 1.4 29% CI - Real Estate 1.7 1.7 1.8 1.8 (31)% PCAM 3.2 2.6 2.5 2.2 2.2 (40)% CIB 0.5 0.3 0.3
Slide 15: ... with further risk-weighted assets reduction allowing for new share buy-backs
... with further risk-weighted assets reduction allowing for new share buy-backs 10.0 Tier 1 ratio, in % RWA, in EUR bn 9.6 9.6 305 9% 293 293 Target range 8% 8.1 7.4 237 239 232 5.9 31 Dec 31 Dec 31 Dec 31 Dec 31 Mar 30 Jun 1999* 2000* 2001 2002 2003 2003 Tier 1 ratio to stay at upper end of 8-9%
Slide 16: Phase 2 management agenda
Phase 2 management agenda Maintaining strict cost, Capitalising on global capital and risk discipline leadership in CIB Delivering profitable Establishing Deutsche Bank growth in PCAM as the most reputable brand Investor Day · September 2003 · 16
Slide 17: CIB with leadership momentum across the board ...
CIB with leadership momentum across the board ... 1H2003 2001 Trend rank Category Rank Share Rank Share All International Bonds(1) #2 9.0% #3 8.5% Ï GM All Euro Inv. Grade Corporates(1) #1 10.1% #1 13.1% Ï All US Inv. Grade Corporates(1),(2) #7 5.9% #10 2.6% Ï European Ordinaries(3) #1 14.7% #1 17.3
Slide 18: ... and the leading Sales & Trading franchise with controlled risk appetite
... and the leading Sales & Trading franchise with controlled risk appetite 1H2003 Sales & Trading revenues 1H2003 Sales & Trading revenues vs. VaR* in EUR bn High #1 Deutsche Bank 5.0 Goldman #2 JPM Chase Sachs UBS #3 Morgan Stanley Citigroup #4 UBS Risk JP Morgan #5 Goldman Sachs Chase Credit Suis
Slide 19: Phase 2 management agenda
Phase 2 management agenda Maintaining strict cost, Capitalising on global capital and risk discipline leadership in CIB Delivering profitable Establishing Deutsche Bank growth in PCAM as the most reputable brand Investor Day · September 2003 · 19
Slide 20: Well positioned vis-à-vis competitors ...
Well positioned vis-à-vis competitors ... PCAM and PCAM equivalents, in EUR bn Invested assets as of 30 June 2003(1) #1 UBS (7)% #2 Fidelity Investm. (10)% #3 Merrill Lynch (16)% (2) #4 Deutsche Bank (9)% #5 Morgan Stanley (26)% #6 State Street 1% #7 Credit Suisse (10)% #8 Citigroup (5)% #9 JPM Chas
Slide 21: … with significantly improved bottom line contribution
… with significantly improved bottom line contribution PCAM underlying pre-tax profit, in EUR m Asset and Wealth Management 150 655 Private & Business Clients 33 117 505 248 261% 353 215 407 140 290 1H2001* 1H2002 1H2003 Severance 1H2003 1H2003 pro-forma * Segment composition as of 31 December 2002.
Slide 22: Phase 2 management agenda
Phase 2 management agenda Maintaining strict cost, Capitalising on global capital and risk discipline leadership in CIB Delivering profitable Establishing Deutsche Bank growth in PCAM as the most reputable brand Investor Day · September 2003 · 22
Slide 23: Focusing our franchise on demanding clients
Focusing our franchise on demanding clients Targeting demanding clients and delivering the firm Clients*: Supported by global marketing campaign to sharpen brand profile CIB 85,000 Rigorously tracking brand delivery Institutional AM 5,000 and client satisfaction Retail AM 8,100,000 PBC 12,900,000 PW
Slide 24: Committed to delivery on phase 2 priorities ...
Committed to delivery on phase 2 priorities ... Strict cost discipline enforced - targeted operating cost Maintaining strict base of EUR <16.5 bn cost, capital and Continued capital reallocation with 25% pre-tax RoE target risk discipline Tier 1 ratio to stay at upper end of 8-9% target range
Slide 25: … unlocking profitable growth opportunities in our core businesses …
… unlocking profitable growth opportunities in our core businesses … Portfolio of initiatives for profitable growth… … in our core businesses Customer / Channel access Global Asset Markets Management Private Global Wealth Product excellence / Equities Management innovation Global Private & Corporate
Slide 26: ... increasing our bottom-line focus
... increasing our bottom-line focus 2Q2003, in EUR bn Underlying revenues 6.0 Total provision for credit losses (0.3) Bringing Phase 1 / Operating cost base (4.5) Phase 2 Underlying pre-tax profit 1.2 initiatives Underlying cost/income ratio 74% to the ... Underlying pre-tax RoE 17% Net income 0.6
Slide 27: Cautionary statement regarding forward-looking statements and non-U.S. GAAP financial measures
Cautionary statement regarding forward-looking statements and non-U.S. GAAP financial measures This presentation contains forward-looking statements. Forward-looking statements are statements that are not historical facts, including statements about our beliefs and expectations. Any statement in thi